For the past seven years, Netflix has been downplaying its legacy DVD-by-mail service as it promotes its streaming video service.
On-demand streaming video has proven to be wildly popular. But while the company’s internet television network has advantages in ease of use, it doesn’t have the vast movie selection that Netflix’s DVD service offers.
Netflix ended the first quarter with 125 million streaming video subscribers worldwide, including 56.7 million in the U.S. But what’s going on with its domestic DVD service?
It finished the quarter with 3.17 million DVD subscribers. That’s down about 20% year over year.
I’m a fan of the Netflix DVD service and am concerned about its future. Its subscriber count has been declining rapidly. That’s partly because Netflix doesn’t really promote the service, aside from social media outreach.
Netflix started as a DVD-by-mail service in 1998. It began offering streaming video for no extra charge to DVD subscribers in January 2007.
In September 2010, it started offering its first streaming-only service in Canada. It added these first international subscribers to its total subscriber number that quarter and didn’t break out DVD subscribers.
In the second quarter of 2010, its last before the Canadian streaming-only service launch, Netflix had 15 million DVD subscribers.
For the next four quarters, Netflix didn’t disclose DVD subscribers, but the number likely hit 20 million.
It started breaking out DVD-only subscriber numbers in the third quarter of 2011. By that time, it was offering streaming-only plans in the U.S., Canada, Latin America and the Caribbean. In the U.S., subscribers who wanted DVDs and streaming had to pay for two plans.
In Q3 2011, Netflix had 13.93 million DVD subscribers. Over the next six years, the DVD service lost 74% of its subscribers.
In a May 15 report, Piper Jaffray analyst Michael Olson predicted that Netflix’s DVD service would end 2018 with 2.7 million subscribers, down 20% from 2017.
He predicts a similar rate of decline for the next two years. Olson believes the Netflix DVD service will have 2.15 million subscribers at the end of 2019 and 1.72 million by the end of 2020.
Related articles:
What happens when studios stop releasing movies on disc? (Tech-media-tainment; April 21, 2018)
Movie fans need to keep Netflix DVD business alive (Tech-media-tainment; May 10, 2017)
Ode to the Netflix DVD rental queue (Tech-media-tainment; May 8, 2017)
Photos:
Artwork celebrating 20 years of Netflix DVDs by mail. (Netflix)
Plotted line chart made at Online Charts with data from Netflix. (Click for larger view.)
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